Giuliani's Bit of Trouble (Updated)

Posted by Damozel |  It doesn't always turn out to be the case in politics that where there's smoke, there's a smoking gun. But Brendan Sexton, Chair of the 2000 Procurement Policy Board---and a Democrat---- is "sickened" by the allegations that Giuliani used his agency to hide $29,757 worth of evidence of his so-called "tryst fund." (NYP  via Memeorandum)  But not because Sexton doesn't believe the allegations.  He said:

The cover-up of this and the explanations for it have been so disingenuous... He didn't want anybody to know what he was doing. That's the truth. I don't care about his personal life - it's not shocking to me that he wanted to visit his girlfriend....The part that's disturbing to me is that my organization or any government organization could be used to conceal from the public how their money was being spent. (NYP)  

Sexton's board was "one of several obscure city agencies billed tens of thousands of dollars for out-of-town travel expenses during Giuliani's last two years in office."(NYP)   

At Bill's Big Diamond Blog, Bill discusses a little bit of documentation dug up by TPM.

Wonder why the city of New York chose to prepay $400,000 in travel to an American Express charge account for its Assigned Counsel Administrative Office in June of 2001? It sure wasn’t because lawyers for indigent clients have a blank checkbook for expenses. It certainly wasn’t to save the City of New York money, which could have been sitting in interest-bearing accounts until the incoming Bloomberg Administration requested the remaining funds be returned the following year.

The answer, we now know, lies in keeping prying eyes away from the details of Judi Nathan and Rudy Giuliani’s travel trysts, just the way scrutiny had previously been diverted in 2000 by travel expenses charged in advance the same way to the City’s Loft Board.

It's the details that get even more interesting.  The practice shifted from the Loft
Board only after the city Comptroller’s office audited the Board's expenditures and was met with a refusal to itemize the suspect expenses by the Mayor’s Office. Instead of stopping the practice, the “Sex on the City” Mayor simply shifted the funding to another city department. It’s not the city carting Rudy’s mistress around that‘s most galling. It’s the arrogance of assuming Rudy could hide it again, after being called on it once, that should tick off anyone paying taxes.

BustardBlog provides some further insight into the allegations:

The straight shooter who was police commissioner during the last two years of the David Dinkins Mayoralty, when crime in New York began its decline, even as it was still increasing in most of the country is Ray Kelly.  Our truly competent current Mayor Mike Bloomberg immediately rehired him as commissioner as soon as he took office, and crime has continued to decline.

Ray Kelly noted that there was neither Dinkins nor Bloomberg followed any of the phony billing practices which Rudi did. He also said that the justification offered by Team Rudi, that there was a need to expedite payment, has never been an issue with either Mayor under whom he served.  (Real Rudi Rises Redux)

"I hate the word Schadenfreude, but I seem to love the feeling," concludes BBustard.  Heh.

The backstory. As all the world knows, Rudy Giuliani is currently fighting off allegations---first raised in the blog Politico---that while he was mayor of New York, he or people working for him were engaging in some unusual bookkeeping regarding certain expenses for his security detail that might have included travel to visit his then mistress/current third wife.(TPM; see also Politico) Since then, there have been additional allegations from former New York officials concerning his use of the police department as an "unofficial taxi service." (ABC News)   At present---and I say this as someone who dislikes Giuliani---it seems a bit sketchy (in both senses).   

And as Giuliani pointed out in an interview, the story is five years old.  (ABC News)  Having seen what happened to Joe Klein, I'm not going to rush to judgment.

And assuming arguendo that these allegations were established, would Republicans---so strangely muffled in their response to Giuliani's adulterous past after all the shock and horror and moralizing over Clinton's dalliance(s)---repudiate Giuliani?  Who the hell knows?  They don't really seem to care about heterosexual peccadilloes, except for Bill Clinton's.  Wouldn't they care if the dalliance was somehow tied to a misuse of taxpayer dollars? 

It might not matter.  The recent downfall of former New York State Comptroller Alan G. Hevesi (a Democrat) shows that clear proof of a diversion of state resources to personal purposes may not only inflict a deathblow on a promising political career, but may also end in felony charges.(Talk Left) So this isn't just a random bit of mud.  If it could

1.  The Allegations Against Giuliani.

Yesterday, Politico reported that they had procured records showing that during his mayoralty Giuliani had billed "hundreds of thousands of dollars in travel expenses" to various "obscure" city agencies rather than---as should have occurred---through the Police Department.   Hmmmm.

As New York mayor, Rudy Giuliani billed obscure city agencies for tens of thousands of dollars in security expenses amassed during the time when he was beginning an extramarital relationship with future wife Judith Nathan in the Hamptons, according to previously undisclosed government record,

The documents, obtained by Politico under New York’s Freedom of Information Law, show that the mayoral costs had nothing to do with the functions of the little-known city offices that defrayed his tabs, including agencies responsible for regulating loft apartments, aiding the disabled and providing lawyers for indigent defendants.

At the time, the mayor’s office refused to explain the accounting to city auditors, citing “security.” The Hamptons visits resulted in hotel, gas and other costs for Giuliani’s New York Police Department security detail. (Politico)

Allegedly,  some of the expenses consisted of "overtime and per diem costs for officers traveling with Giuliani to secret weekend rendezvous with Nathan in the fashionable Hamptons resort area on Long Island." (ABC News) Billing the expenses to "obscure agencies" (I'm sure the obscure people who work for them loved that) might have been intended to hide them from oversight. (see ABC News) 

But Bernard B. Kerik, Giuliani's police commissioner at the time the charges were being diverted to the so-called "obscure" agencies, considers it ridiculous to infer that the charges were diverted to other agencies in order to conceal them.    Kerik---who I don't have to tell you has troubles of his own---didn't see any reason or point for Giuliani to conceal expenses he incurred for his security detail. (New York Times).  Which does seem to be a good point.  Even if he was traveling to visit his girlfriend, surely he'd still be expected to travel with security. But couldn't the purpose of the diversion have been to conceal that he was travelling to visit his girlfriend?   

In any case, Mayor Bloomberg's office thinks the expenses were eventually properly reimbursed by the Police Department. (New York Times)    Furthermore, on an inteview, Giuliani told CBS anchor Katie Couric that his billing procedures made the expenses more discoverable than if he'd billed them to the Police Department, not less, and reiterated that all the expenses had in fact been reversed. (CBS News).  And Couric remarked "that three budget directors"  had explained it to her the same way that Giuliani has explained it.(CBS News).

Of course, there are additional allegations by  "former senior city officials" who have informed ABC News that "[w]ell before it was publicly known he was seeing her, then-married New York Mayor Rudy Giuliani provided a police driver and city car for his mistress Judith Nathan..."She used the PD as her personal taxi service," said one former city official who worked for Giuliani." (ABC News)

If established, the use of police resources for the benefit of Judith Nathan would seem a clearer case of misuse of city funds and closer to the conduct that got former Comptroller Alan Hevesi charged with a felony(Talk Left), though there's no indication whether the alleged misuse by Giuliani---if it occurred at all----was on anything like the same scale as Hevesi's. .

2.  Potential Seriousness of Allegations:  Alan Hevesi's fall from grace

Still, the Hevesi story shows that New York State takes a very dim view indeed of any use of public resources for private ends. And Hevesi's reasons---compared, say, to Giuliani's---are tragic.  Former Comptroller Hevesi, a Democrat, apparently used a state employee to drive around and act as a personal assistant to his admittedly extremely ill wife. (New York Times) In the end, he was charged with a felony and forced to resign. (New York Times)

 New York state Republicans jumped on Hevesi---previously considered a "shoo-in"--- with both feet and in the manner which has become typical of the GOP, unleashing a series of campaign ads intended to discredit him in the public eye, and which did discredit him. (Newsday)  After "chauffeur-gate", Chuck Schumer (D-NY) said, “What he’s done now is very, very wrong....You can’t just say it’s a mistake and flick it away.”. (Times Union.com)  

 Digging in his heels, Hevesi "reluctantly" revealed that his sick wife was "a woman so wracked with pain from spinal and back problems that she attempted suicide more than once" and eventually had to be put in a nursing home. (Newsday)  She really does seem to have been extremely ill. (Newsday)  Which of course still begs the question why Hevesi didn't feel he should use his own funds to provide her with assistance, the way the rest of us do (Newsday)

Hevesi eventually said he was sorry for not reimbursing the state for using a public employee as a driver for his wife and reimbursed over $206,000 in expenses.(Newsday)   In the end, though,  he pleaded guilty to a felony and resigned. (New York Times)  After all, as Comptroller, Hevesi was "top fiscal watchdog.". (New York Times). 

The conclusion is sad:

[H]e told the court in a hoarse voice that one of the state workers he had assigned as a driver for his wife, Carol, had done much more than provide security for her. Prosecutors filed court papers revealing that the worker had also watered her plants, driven her to Bloomingdale’s and dropped off her dry cleaning.

“I apologize to the court, but until this issue became a public matter, I did not plan to reimburse the state for his time,” Mr. Hevesi told the court under oath, in a reversal of the statements he made this fall during his successful re-election campaign.

In a deal with the Albany County district attorney’s office, Mr. Hevesi pleaded guilty to a single felony, agreed to pay a $5,000 fine on top of the more than $206,000 he has already reimbursed the state, and agreed to resign for the rest of his current term and for the term that begins Jan. 1. The agreement will spare him prison time. (New York Times)

Can the Allegations be Proved?    Did Giuliani---who, incidentally, was "on hostile terms with Hevesi" (The Politico)  --- engage in a similar diversion of state resources to personal use?  And if so, was the diversion on a sufficient scale to lead to the same consequences?   These aren't rhetorical or Socratic questions.  I don't know. 

The allegations and reports I've read so far---barring the "used the police department as a personal taxi service" allegations----don't seem to show anything more than the use of some rather odd accounting practices, which Giuliani and his aides attribute to a bookkeeper-engendered workaround that had nothing to do with him. (The Politico)    (The New York Times states that the specific accounting mechanisms "remain something of a mystery.")   The current city comptroller (a Democrat) says that the travel expenses for Giuliani's security detail  "should have been charged to a single budget account that would directly reflect who traveled and for what purpose, rather than distributed among offices that had nothing to do with the trips."(New York Times) 

According to him, auditors during Giuliani's administration did in fact question the travel costs, but "requests....for details and justification went unanswered.""(New York Times)  After the current comptroller took office, he asked Mayor Bloomberg's office to review the issue, and Bloomberg's office "ultimately concluded that the expenses were for legitimate security purposes." (New York Times)   On the other hand, they also referred the issue to New York's Department of Investigation.(New York Times)   The Comptroller says he was told by Bloomberg's office that the circuitous accounting was for security purposes, that it was used for legitimate security reasons......And once you get that assurance, particularly from not the same mayor’s office, but from a different mayor’s office, that they had taken a look, then we had no reason to believe that it wasn’t.”(New York Times)

Giuliani and his aides attribute these accounting practices to  "anonymous bookkeepers" who found that the payments would go through much more quickly if billed to agencies other than the Police Department. (The Politico)   Giuliani says that the billing was 'perfectly appropriate."   As noted, Mayor Bloomberg's office seems to have included that the police in fact reimbursed those city agencies for the expenses. (The Politico)

As to the specific expenses, here is what The New York Times learned when they procured his records under the Freedom of Information Act:

Overall travel expenses for the mayor’s office — which included a broad range of trips beyond just those involving the security detail — were clearly growing at the end of the mayor’s term, according to the city comptroller, with a 151 percent increase from the fiscal year 2000 to the 2001 fiscal year, to $618,014 from $245,896.  

Some of the expense reports show that the mayor’s security detail traveled to upstate New York towns during the period in late 1999 and early 2000 when he was seeking the United States Senate seat.

However, the documents also show that only a part of the spending was incurred by Mr. Giuliani’s detail as it traveled to accompany him to many places, including Washington, where he conducted city business, and Southampton, where he raised money and where Ms. Nathan had her condominium.

Another significant portion of the money was spent on travel for police detectives who accompanied his second wife, Donna Hanover, on various trips, including several to California. (New York Times) 

In his interview, Giuliani told Katie Couric that the whole set of allegations was just a "debate day diirty trick."(CBS News) But Couric quite rightly pointed out that the report wasn't planted by his opposition and that The Politico got the records through the Freedom of Information Act....""so the notion of it somehow being a political "hit job," do you really believe that? ""(CBS News) But Giulani insisted that the timing---two hours before a Republican debate---was suspicious, since it took 12 to 14 hours for him "to show it's not true." (CBS News) 

From Politico, this response:

 

Politico editor-in-chief John F. Harris said in a statement: “This was a fair and carefully reported story. We gave the Giuliani campaign ample opportunity to dispute the story or comment on our reporting before publishing and they did not do so. Since the story ran, we have not heard from the campaign disputing any substantive aspect of the story.”(Politico)  

So anyway, having no head for accounting and no precise knowledge of the New York rules of ethics for city officials, I'm just not sure exactly where the misconduct or alleged misconduct lies, unless somehow these expenses were (1) not improperly incurred; and (2) ultimately reimbursed.  As for the "personal taxi services" allegations, those sound more like the allegations made against Hevesi and aren't really answered by Giuliani's responses in the CBS interview. 

So anyway, and for now:  Hmmmmm. 

 BLOGGER REACTIONS:

Memeorandum buzz is here. 

LINKED

TRYST FUND 'SICKENS' EX-OFFICIAL (New York Post NEW)

Rudy:  "Debate Day Dirty Trick" (CBS News)

Giuliani calls billing 'perfectly appropriate' (Politico)

Giuliani billed obscure agencies for trips (Politico) 

Giuliani's Mistress Used N.Y. Police as Taxi Service (ABC News)

 BREAKING: Rudy's New Shag Fund Explanation! (TPM)

More on Government Funded Trysts:  It's a Crime (Talk Left)

 Chuck On Alan (Updated) (Times Union.com)

Giuliani Defends Spending on His Mayoral Security (New York Times)

 GOP grabs at a new opportunity (Newsday)

Hevesi discusses wife's health (Newsday)

Hevesi: I'm sorry for unpaid bill (Newsday)

Hevesi Pleads Guilty to a Felony and Resigns (New York Times)

Comments

[On a Limb with Claudia]

I'm really not a prude. I just believe what Pat Croce says. If you are willing to cheat on your wife (publicly no less) then you are willing to cheat anywhere in your life. He's just a cheat.